Aleris International U.S. Operations File for Chapter 11 to Address Business and Financial Challenges



    All Facilities Open, Normal Operations Continue; Aleris Obtains $1.075
Billion DIP Financing Commitment from Bank Group
    

    International Operations Not Included in the Filing

    
    BEACHWOOD, Ohio, Feb. 12 /PRNewswire/ -- Aleris International, Inc., a
global leader in aluminum rolled products, extrusions and recycling, announced
today that it and its wholly-owned U.S. subsidiaries have filed petitions for
voluntary reorganization under Chapter 11 of the U.S. Bankruptcy Code as a
result of financial constraints related to deteriorating demand, earnings, and
liquidity caused by the steep decline in global economic conditions. The
filing was made today in the U.S. Bankruptcy Court in Delaware. The Company's
European, Asian, South American, Mexican and Canadian operations were not
included in the filing.
    

    
    To fund its global operations during the restructuring, Aleris has
secured $1.075 billion of debtor-in possession (DIP) financing. Subject to
court approval, the DIP credit facilities include a new $500 million term loan
and a $575 million revolving credit facility that replaces the Company's
previous revolving credit facility. These will be used for the Company's
normal operating and working capital requirements, including employee wages
and benefits, supplier payments, and other operating expenses during the
reorganization process. The Company believes that the DIP credit facility
provides sufficient funds for its reorganization effort under Chapter 11.
    

    
    "We have moved aggressively to reduce our costs and eliminate capacity to
offset the negative effects of the global economic slowdown. However, given
the unpredictability of the speed and severity of the downturn over the last
few months, these actions were not sufficient to counter the combination of
challenges Aleris faces, including a sharp deterioration in demand for our
products by the automotive, housing, and general industrial products sectors
and an unprecedented decline in aluminum prices which limited our borrowing
ability," said Steven J. Demetriou, Aleris Chairman and CEO.  "After careful
deliberation with our advisors, the Company's Board of Directors concluded
that seeking the protection of Chapter 11 for our U.S. operations is the only
option to preserve and maximize value for all of our economic stakeholders.
This should allow us the time to work through the current dislocations and the
opportunity to pursue a financial and operational restructuring that creates a
more competitive foundation for the long term.
    

    
    "While we regret the need to take this difficult step, we believe a
financial recalibration is necessary for us to resume a path of growth and
continue to build a global aluminum enterprise that will endure.
    

    
    "Aleris is conducting business as usual across the Company," continued
Mr. Demetriou.  "Our customers can continue to have confidence that they will
receive their orders on time and as specified. Our suppliers can expect timely
payment in full for all goods and services provided from today forward.
Furthermore, we have petitioned the Court for customary first day orders,
which will ensure that our employees will be paid in full and on the normal
schedule and that our operations will function normally and without any
disruption."
    

    Further Information

    
    Aleris reported total assets of approximately $4.9 billion and total
liabilities of approximately $4.2 billion, on a consolidated basis, as of
September 30, 2008.
    

    
    More information about Aleris's filings and restructuring is available on
the Company's restructuring information web site at
www.Aleris.com/restructure.
    

    Court filings and claims information are available at
www.kccllc.net/Aleris.

    
    For further information or assistance with claims, please call Aleris's
Restructuring Information Line toll-free at (866) 927-7089.
    

    About Aleris

    
    Aleris International, Inc. is a global leader in aluminum rolled products
and extrusions, aluminum recycling and specification alloy production.
Headquartered in Beachwood, Ohio, a suburb of Cleveland, the Company operates
over 40 production facilities in North America, Europe, South America and
Asia, and employs approximately 8,400 employees. For more information about
Aleris, please visit our Web site at www.Aleris.com.
    

    Safe Harbor Regarding Forward-Looking Statements

    
    Forward-looking statements made in this news release are made pursuant to
the safe harbor provision of the Private Securities Litigation Reform Act of
1995. These include statements that contain words such as "believe," "expect,"
"anticipate," "intend," "estimate," "should" and similar expressions intended
to connote future events and circumstances, and include statements regarding
future actual and adjusted earnings; future improvements in margins,
processing volumes and pricing; overall 2008 operating performance;
anticipated effective tax rates; expected cost savings; success in integrating
and anticipated synergies resulting from Aleris's recent acquisitions,
including the acquisition of the downstream aluminum businesses of Corus Group
plc; its future growth; the anticipated economic environment in 2008; and
future benefits from acquisitions and new products. Investors are cautioned
that all forward-looking statements involve risks and uncertainties, and that
actual results could differ materially from those described in the
forward-looking statements. These risks and uncertainties would include,
without limitation, Aleris's levels of indebtedness and debt service
obligations; its ability to effectively integrate the business and operations
of its acquisitions; further slowdowns in automotive production in the U.S.
and Europe; the financial condition of Aleris's customers and future
bankruptcies and defaults by major customers; the availability at favorable
cost of aluminum scrap and other metal supplies that Aleris processes; the
ability of Aleris to enter into effective metals, natural gas and other
commodity derivatives; continued increases in natural gas and other fuel costs
of Aleris; a weakening in industrial demand resulting from a decline in U.S.
or world economic conditions, including any decline caused by terrorist
activities or other unanticipated events; future utilized capacity of Aleris's
various facilities; a continuation of building and construction customers and
distribution customers reducing their inventory levels and reducing the volume
of Aleris's shipments; restrictions on and future levels and timing of capital
expenditures; retention of Aleris's major customers; the timing and amounts of
collections; currency exchange fluctuations; future write-downs or impairment
charges which may be required because of the occurrence of some of the
uncertainties listed above; the difficult conditions in the capital, credit,
commodities, automobile and housing markets and in the current economy; and
other risks listed in Aleris's filings with the Securities and Exchange
Commission (the "SEC"), including but not limited to Aleris's annual report on
Form 10-K for the fiscal year ended December 31, 2007, and quarterly report on
Form 10-Q for the quarter ended September 30, 2008, particularly the section
entitled "Risk Factors" contained therein.
    

    

    
    U.S. Media Contacts:
    

    
    Kekst and Company
    Ruth Pachman, 212-521-4891
    David Lilly, 212-521-4878


    




For further information:

For further information: U.S. Media, Ruth Pachman, +1-212-521-4891, or
David Lilly, +1-212-521-4878, both of Kekst and Company, for Aleris
International, Inc. Web Site: http://www.Aleris.com

Organization Profile

Aleris International, Inc.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890